Pubs to get greater share of pokies under rule change

By Nick Toscano & Daniel Cherny

July 18, 2018 — 12.01am

A long-standing arrangement splitting Victoria's poker machines evenly between pubs and clubs has been quietly axed, with the Andrews government allocating 414 lapsed pokies licences from clubs to what anti-gambling groups say is the "more aggressive" pubs sector.

From 2022, pub operators including the Woolworths majority-owned ALH Group will hold 51.5 per cent of Victoria's 27,372 poker machine entitlements and the state's clubs will hold 48.5 per cent, according to a legal amendment struck by Gaming Minister Marlene Kairouz earlier this month.

The Collingwood Football Club has announced it is exiting the pokies business.Credit:Peter Braig

The break from the years-long 50-50 split between pubs and clubs was brought to light by gambling reform campaigners on Tuesday, the same day Collingwood Football Club announced its decision to sell its poker machine licences and join North Melbourne in becoming pokies-free. The Melbourne Football Club has also announced it will abandon the gambling industry when its pokies licences expire in 2022.

The Alliance for Gambling Reform praised Collingwood and its club president, Eddie McGuire, for sending a "powerful message" to the community that they no longer wished to be associated with gambling products "designed to addict".

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"Well done, Eddie," alliance director Tim Costello said on Tuesday. "You are a trailblazer who is looking after the battlers and leading by example."

Under the Victorian government's long-standing arrangement for poker machine entitlements, clubs and pubs are each capped at 13,686 machines. But once new 20-year licences come into effect in 2022, the pubs sector's share will increase to 14,100, and club licences will be capped at 13,272.

Mr Costello said a typical poker machine in a club made about $80,000 a year compared with $130,000 in a hotel.

"The government knows that pokies pubs are significantly more lucrative than clubs," he said. "So this decision to hand over 414 lapsed club entitlements to the hotels sector will further increase losses."

Mr Costello said the surplus club licences should have been retired, but instead, pub chains such as Woolworths, Castello's, Zagames and Black Rhino would be able to "expand their empires".

The ALH Group said it had no plans to acquire any further gaming machine entitlements.

The state government said laws were changed last year to give the minister the power to change the 50-50 split from 2022.

Ms Kairouz said the Andrews government had frozen the total number of pokies in Victoria for the next 25 years, capped pokies in vulnerable areas and instituted cash withdrawal limits in gaming venues.

Collingwood president Eddie McGuire.Credit:AAP

Mr Costello said that in the 2017 financial year, the Collingwood Football Club took in $12.2 million in pokies losses across its two gaming venues, the third largest amount of any AFL club.

"So this is the biggest pokies divestment in the unfortunate history of AFL clubs ripping more than $2 billion from gamblers over the past 25 years," he said.

Collingwood will sell its two gaming venues in Ringwood and Caroline Springs with 156 poker machines to the Melbourne Racing Club. Settlement is expected to take place in October.

Ms Kairouz said the state government welcomed Collingwood's decision to exit the pokies industry, "a move that will encourage footy fans to love the game, not the odds".

Hawthorn president Jeff Kennett, whose club yields more money from pokies than any other, warned this year of financial dangers for clubs that left gaming without finding an alternative revenue stream.

AFL commission chairman Richard Goyder has publicly spoken of his distaste for pokies and desire for clubs to move away from them as a source of revenue.